VW to launch Seat brand in China

(Bloomberg) -- Volkswagen AG plans to introduce its Seat brand in China and will have a stand for the Spanish cars on display at the Shanghai auto show next month.

Francisco Javier Garcia Sanz, a member of the carmaker's management board, announced VW's plans for Seat at a press conference.

Volkswagen Group currently markets the Audi, Lamborghini, Skoda and VW brands in China. Seat, which is headquartered in Martorell, Spain, specializes in affordable compact cars.

VW is trying to move the brand somewhat upscale with a lineup of sporty cars.

According to a report by IHS Global Insight, VW will initially import Seat models into China, then launch production at its Foshan assembly plant, which will be completed in 2013.

VW's joint venture with China FAW Group Corp. will run the Foshan plant, which is located in southeast China's Guangdong province.

While VW Group's other brands have prospered in China, a successful launch for Seat is not assured. Elsewhere, the brand has struggled. In 2010, Seat lost 311 million euros on a 0.8 percent rise in sales to 340,000 vehicles. According to IHS, VW will close the Seat brand by 2015 if it fails to become profitable.